The board of directors “discussed most thoroughly and substantively Norilsk Nickel’s letter asking for the sale of 15 percent of its shares and unanimously decided to refuse to sell 15 of the 25 percent of Norilsk Nickel shares owned by RUSAL,” RUSAL’s press service said on Monday, September 5.

It said the decision was made “because the offered terms do not reflect the fundamental cost of the blocking package of Norilsk Nickel shares, which is RUSAL’s strategic investment”.

On August 19, Norilsk Nickel said it had prepared an offer for a new buyback of shares from OK RUSAL Investment Management (a part of RUSAL) for 8.75 billion U.S. dollars

The offered price, determined on the basis of recommendations issued by independent bank-consultants, is 306 U.S. dollars per share and envisions a bonus of 20 percent of the average weighted market price over the last six months.

The Norilsk Nickel Board of Directors will consider the offer on August 24.

In April 2011, Norilsk Nickel’s subsidiary Corbiere Holdings completed a buyback of Norilsk Nickel shares and ADRs by purchasing 6.85 percent of shares for 3.3 billion U.S. dollars.

The company acquired 13,067,302 shares, including shares certified by ADRs, at a price of 252 U.S. dollars per share and 25.2 U.S. dollars per ADR.

Norilsk Nickel also offered to buy 25 percent of its shares from RUSAL for 12 billion U.S. dollars, but then changed it offer to 20 percent of shares for 12.8 billion roubles. RUSAL rejected all offers.

RUSAL co-owners Viktor Vekselberg and Mikhail Prokhorov thought that Norilsk Nickel’s latest offer should be accepted. In June, Prokhorov said he would support a new offer if it were better than the previous one.

But RUSAL CEO Oleg Deripaska said he would not agree to the deal and stressed that there was a price for which he could sell his assets but never named it.

According to Deripaska, a quarter of Norilsk Nickel’s shares cost 20 billion U.S. dollars.

Experts say that it is unlikely that the shares would be purchased at a price close to that offered in February. Norilsk Nickel shares have not reacted to the news yet and gained 2.15 percent on stock exchanges on Monday.

While negotiating the purchase of its shares from RUSAL, Norilsk Nickel started buying back its shares. In the meantime, Norilsk Nickel ADRs worth about 8 percent of equity capital were sold to oil trader Trafigura. RUSAL challenged these transactions in court, but the court ruling was later cancelled.

The conflict between RUSAL and Interros over Norilsk Nickel has been on for three years, since the incorporation of Deripaska’s company into Norilsk Nickel. In 2008, Deripaska bought 25 percent plus one share of Norilsk Nickel from Porkhorov, making a strategic investment as he planned to consolidate RUISAL and Norilsk Nickel assets under his control. But Potanin objected, backed up by the Norilsk Nickel management.

According to the company, Norilsk Nickel’s production facilities are located on three continents and in five countries: Russia, Australia, Botswana, Finland, and South Africa.

The main Russian production units are vertically integrated and include the Polar Division and the Kola Mining and Metallurgical Company.

The Polar Division is located above the Polar Circle on the Taimyr Peninsula in the Krasnoyarsk Territory. Its entities are connected to other regions of the country, via the River Yenisei and the Northern Sea Route, as well as by air. Kola MMC is located on the Kola Peninsula, which is the largest industrial producer in the Murmansk region, and is fully integrated into the transport infrastructure of the Northwest Federal District of the Russian Federation.

The Group owns Norilsk Nickel Harjavalta, the only nickel refining plant in Finland.

In South Africa, the Group holds a 50 percent interest in the Nkomati nickel mine, a joint venture with African Rainbow Minerals (ARM).

The Group also includes the Gipronickel Institute, a research and development facility located in Saint Petersburg, with branches in the cities of Norilsk and Monchegorsk; Norilsk Process Technology, a research and development facility in Australia.

Norilsk Nickel has its own global network of representative and sales offices in Russia, the UK, China, USA and Switzerland.

In Russia, the company’s shares are traded on the Moscow Interbank Currency Exchange (MICEX) and the Russian Trading System (RTS). The ADRs of the company’s shares are traded over-the-counter (OTC) in the United States, on the electronic International Order Book Unlisted section of the London Stock Exchange and on the Freiverkehr (OTC-section) of the Berlin-Bremen Stock Exchange.